Tag Archives: supermarket customer service and loyalty

A recentSupermarketNewsarticle reported that Target will begin offering same-day delivery to customers in three metro areas—Boston, Miami and Minneapolis—starting Feb. 1.

The move comes following the retailer’s December acquisition of Shipt, the article said.

The article went on to say that online retail is picking up speed at an even faster rate than previously thought, and that both Food Marketing Institute and Nielsen data suggest 70% of consumers will shop for groceries online by 2024.

The trend toward on-line shopping is a strong one for sure, but supermarkets by-and-large have significantly improved the level of customer service and the in-store shopping experience.

The question is, how can they combine the two “experiences” to build stronger levels of customer satisfaction and loyalty?

A recent SupermarketNews article reported that Kroger has launched a new improvement initiative to accelerate changes in assortments and better customer service.

While Kroeger has been in the news lately for considering the sale of its convenience stores, the new “Restock Kroger” improvement initiative seems to be the bigger story. It will involve “an accelerated and more data-driven effort around pricing, personalized communications with customers, and a revamp of product assortments,” the article said.

“We will change the way people eat in the U.S.,” said Rodney McMullen, chairman and CEO. “If you are eating, we want to serve you. Unless you are eating in a white tablecloth restaurant, we want to be able to provide that meal for you.”

A recent “10 Items or Less” article posted by SupermarketNews identified steps taken by major food retailers that indicate the focus on e-shopping will continue to grow in 2017.

The article states that Wal-Mart Stores plans to have around 1,100 stores offering online grocery pickup this year, and that they are continuing with initiatives built around making fulfillment more versatile and/or efficient, such as offering discounts on online orders picked up in stores, and testing the idea of having store employees deliver orders to customer’s homes on their post-work commutes.

The piece goes on to report that Amazon said it was rolling out “Instant Pickup,” a free service offering its Prime members a curated selection of “daily essentials” available for pickup in two minutes or less. The service is available at five campus locations currently with plans to add more locations soon.

Even no-frills Aldi had issued a statement indicating it was getting into e-commerce for the first time through a partnership with Instacart in three cities.

“Our partnership with Instacart is another example of Aldi expanding our commitment to customer convenience and value,” Jason Hart, CEO of Aldi, said. “We know customers are looking for new ways to save time and money.”

As these new services are being rolled-out, it strikes me that supermarket chains will need to take an innovative approach to refining their work processes to reduce waste and cost.

The Seattle Times recently published an interesting and entertaining article, which referenced the announcement made late last year by Amazon.com regarding the launch of an experimental convenience store in downtown Seattle where customers could skip the checkout line.

While the concept was presented as futuristic and technologically innovative, a French retail chain, Monoprix, took issue with that depiction.

As the video showcased within the article explains (in a clever and somewhat humorous way), “Monoprix’s “Livraison à domicile +,” is their 10-year-old service that also allows shoppers skip the checkout lines – via a different form of innovation.

A recent SupermarketNewsarticle reported that Wegmans is launching an e-commerce partnership with Instacart , which will enable online shopping and delivery at Wegmans Food Markets in select cities.

According to the article, the service will be available in Northern Virginia and Maryland, and will allow customers to order from Wegmans online and have their groceries delivered to them in as little as one hour.

A Wegmans spokesperson was quoted in the article as saying “it was offering the service to meet customer demand for time.”

This perspective is common as, in an effort to respond to consumer demand and competitive pressure, numerous food retailers have been striving to provide online offerings.

We expect the trend to continue as supermarket chains find new and innovative ways of maintaining customer loyalty.

While possibly making less of a splash than the Amazon-Whole Foods deal, Lindl US opened a new store in Virginia Beach, VA, signifying the beginning of what many have termed a new era in food retail.

According to a SupermarketNews article, hundreds of shoppers were waiting in a line that circled the parking lot early Thursday morning waiting for Lidl US to open the doors.

The big splash and anticipated disruption to the industry may be based on a number of factors, two of which truly stand out:

Lindl US is committed to offering the lowest prices. “We will beat the best prices in the market,” Brendan Proctor, CEO says.

Lindl US is basing decisions on the voice-of-the-customer. “It’s not about whether our model works in a market,” Proctor said during an interview. “It’s about what we have to do to adapt to the market.”

A number of presentations at this year’s NRA Show in Chicago focused on how supermarkets and c-stores can build on some key elements of restaurant design to create a dining experience customers will seek out.

In other words, the combination of upscale design and finer dining options can be leveraged to make a supermarket or c-store a destination where customers feel welcome to stay, dine and enjoy.

“Consumers care about what the experience is like, and 90% of the information sent to the brain is visual,” Tré Musco of Tesser, a brand strategy design firm, said. “People form judgments instantaneously. In terms of design, perception is reality.”

But Tre Musco and other presenters also noted that, if a store is to become a place to enjoy a meal, customers must perceive it as such.

Some of the steps retailers will need to take in order to accomplish this include:

Lead with change… go beyond just “adding a few tables and chairs” and create a warm, comfortable, and alluring dining area.

Aldi currently boasts 1,600 U.S. stores, but only accounts for about 1.5 % of the U.S. market. A company spokesperson referenced in the article says Aldi is growing at 15% per year and plans to open 400 new locations by the end of next year; he also said Aldi’s prices are 21 % lower than its lowest-priced competitors.

Walmart, on the other hand, currently controls about 22 % of the market and its U.S. sales are estimated to grow about 2 % this year, according to analysts; and, of course, Amazon continues to grow Amazon Fresh while feverishly testing brick-and-mortar stores.

At the same time, in a race based on customer satisfaction and shopping experience, MediaPost reported the results of a Top Grocer’s survey done by Market Force, a market research company based in Louisville, Colorado. Their customer loyalty index is based on responses from some 12,700 consumers, the article said, and the top slots were awarded to:

Wegmans and Publix (tie for 1st)

Trader Joe’s

H.E.B.

Ironically, Walmart came in last in the Market Force survey… which makes one realize that price does not necessarily guarantee customer loyalty.

In a recent SupermarketNews article, Evins explains that grocers face the dilemma of keeping their margins low by spending less while still delivering quality products. More labor requires higher costs, but without the additional attention to fresh foods, products will not be up to standards.

The solution: Grocery retailers should leverage digital resources and process improvement to more easily monitor, plan and execute their efforts.

“Automation of simple tasks can help ensure manpower is used in more critical roles rather than routine monitoring and conditions management.”

The article goes on to present ways in which digital information can help supermarket management better-understand what products are most popular and what are consistently undersold, as well as which processes are the best candidates for streamlining. They would then be able to better manage some of the more challenging yet vital areas of the business, such as the fresh foods and perishable sections, which typically comprise up to 50 percent of sales and more than 60 percent of profits.

In addition to leveraging technology to improve operational efficiency, Elvins also stresses the importance of using data to better-understand customer preferences, and to drive the customer experience (CX).

“Stores must differentiate from online by taking advantage of consumer senses, drawing consumers into the store, and using experiences to convert the sale,” he writes.

In-store events like wine tastings, and providing local product representatives and vendors throughout the store to offer expert opinions, are often popular offerings that aren’t possible online, thus creating greater brand-and-store loyalty as well as a competitive edge over online retailers.

As you most likely are aware, Instacart provides shopping and home delivery in a variety of stores.

In an ongoing effort to generate more precise shopping trips — i.e., a faster way of shopping for its employees, who are shopping on behalf of customers — the San Francisco-based company has been testing various ways to determine how people might most efficiently shop for items on a list, ranging from:

an alphabetical list

a route-based approach

an artificial intelligence (AI) approach that uses data from the company’s most efficient shoppers to predict a sequence of picks that would be the most efficient

The article states that people are using AI to solve hard problems more and more… and the algorithms used for more traditional problem solving are not so different from those that can determine how a human would pick-up specified items in a store. In fact, Instacart is able to “guess” the next item a shopper will pick 60% of the time with the AI solution!

“It’s not 95%,” said Jeremy Stanley, VP of data science at Instacart. “But there’s room for variance and error. When we look at the overall sequence it mimics what the shopper does very closely, and usually only reverses a few items per trip.”

Might there be an application for using this AI approach for you and me to enhance our food shopping experience?

If so, how might retailers view this developing use of technology, considering it might make shoppers less susceptible to impulse buying because they will do less wandering through the aisles?

To move to a system of continuous improvement requires that organizations develop the right mindset and use the right language and tools every day, in all their activities. That is a major culture change for most organizations.

But once people know what to work on, the question becomes which tools and methods will help you achieve your goals.

With our vast experience in a variety of industries, cultures and countries, we work with you to identify those methods and teach you to build your skills so that you can apply those methods and tools to future problems and opportunities.